Netflix and Warner Bros. Discovery Announce $82.7 Billion Deal That’s Changing the Entertainment Landscape
Netflix has announced its acquisition of Warner Bros. Discovery, a landmark deal valued at $82.7 billion.
Under the terms of the agreement, Netflix will pay $27.75 per share for the storied Hollywood studio, translating to a total equity value of $72 billion. This acquisition includes Warner Bros.’ film and television studios, as well as HBO Max and HBO, although it remains subject to various regulatory approvals.
The move is set to follow the spin-out of WBD’s global networks division, Discovery Global, into a new publicly traded company, which is projected to occur in Q3 2026.
In its official statement, Netflix emphasized its intention to “maintain Warner Bros.’ current operations” and to “build on its strengths, including theatrical releases for films.” The company also noted that the acquisition would allow for a “significant expansion of U.S. production capacity.”
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“Our mission has always been to entertain the world,” stated Ted Sarandos, co-CEO of Netflix. “By combining Warner Bros.’ incredible library of shows and movies—from timeless classics like Casablanca and Citizen Kane to modern favorites like Harry Potter and Friends—with our culture-defining titles like Stranger Things, KPop Demon Hunters, and Squid Game, we’ll be able to do that even better. Together, we can give audiences more of what they love and help define the next century of storytelling.”
Greg Peters, the other co-CEO of Netflix, added that the acquisition would “improve our offering and accelerate our business for decades to come.” He emphasized, “Warner Bros. has helped define entertainment for more than a century and continues to do so with phenomenal creative executives and production capabilities. With our global reach and proven business model, we can introduce a broader audience to the worlds they create—giving our members more options, attracting more fans to our best-in-class streaming service, strengthening the entire entertainment industry, and creating more value for shareholders.”
“Today’s announcement combines two of the greatest storytelling companies in the world to bring to even more people the entertainment they love to watch the most,” said David Zaslav, President and CEO of Warner Bros. Discovery. “For more than a century, Warner Bros. has thrilled audiences, captured the world’s attention, and shaped our culture. By coming together with Netflix, we will ensure people everywhere will continue to enjoy the world’s most resonant stories for generations to come.”
The terms of the acquisition stipulate that each Warner Bros. Discovery shareholder will receive $23.25 in cash and $4.50 in Netflix common stock for each share of WBD common stock.
Moelis & Company LLC is serving as Netflix’s financial advisor while Skadden, Arps, Slate, Meagher & Flom LLP provides legal counsel. Wells Fargo is also acting as a financial advisor alongside BNP and HSBC, which are providing committed debt financing related to the transaction.
Allen & Company, J.P. Morgan, and Evercore are advising Warner Bros. Discovery, with legal counsel provided by Wachtell Lipton, Rosen & Katz and Debevoise & Plimpton LLP.
Political considerations have significantly influenced the sale process, and reactions from the White House are anticipated following this announcement. Paramount, a competitor, has claimed that its offer represents the only viable path to closing, stating that the competing bids from Netflix and Comcast present “serious issues that no regulator will be able to ignore.” Paramount has expressed concerns regarding potential antitrust issues stemming from Netflix’s dominance in streaming.
Additionally, David Ellison’s company has criticized the sale process as “unfair and tilted” towards Netflix. Warner Bros. Discovery countered that its board is committed to fulfilling its fiduciary obligations with diligence.
In a pointed remark regarding Warner Bros. Discovery CEO David Zaslav, Paramount suggested that management conflicts may have marred the sales process. Notably, Paramount had previously extended an employment offer to Zaslav contingent upon a merger. However, details regarding Zaslav’s potential role in a Warner-Netflix merger remain unclear.
